8 banks flunk European stress test; 16 more barely pass

  • Posted by a hidden member.
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    Jul 15, 2011 6:06 PM GMT
    These stress tests are hardly stressful at all - that simulated "what would happen to bank finances during a recession where growth falls more than 4 percentage points below EU forecasts. For the 17-country eurozone, that would be a drop of 0.5% this year and 0.2% next year."

    http://www.usatoday.com/money/world/2011-07-15-eu-bank-stress-tests_n.htm

    Eight of 90 European banks have flunked stress tests that project how they would fare in another recession, and 16 more barely passed, Europe's banking regulator said Friday.

    The failing banks should "promptly" take steps to strengthen their financial cushions against losses, the European Banking Authority said as it released the results.

    The banks that barely passed may also face pressure to strengthen their finances.

    The EBA lacks the power, however, to force banks to raise more capital — whether from investors or governments — or to make them merge or sell businesses. Only their national governments can do that.

    The tests are a key element in fighting Europe's debt crisis. Officials want to identify weak banks and make them strengthen their finances so they could survive a possible default on government bonds by Greece or another heavily indebted country.

    The test, run by national banking regulators, simulated what would happen to bank finances during a recession where growth falls more than 4 percentage points below EU forecasts. For the 17-country eurozone, that would be a drop of 0.5% this year and 0.2% next year.

    Some said the tests were not tough enough because they did not include a scenario in which Greece defaults on its government bonds. That is considered a key risk for Europe's economy.
  • rnch

    Posts: 11524

    Jul 15, 2011 6:33 PM GMT
    why no list of the banks?

    "USA Today" is all too often the "Entertainment Tongiht" of the print media. it's articles seem to be designed to be just long enough to read while taking the average length dump.
  • Posted by a hidden member.
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    Jul 15, 2011 11:06 PM GMT
    rnch saidwhy no list of the banks?

    "USA Today" is all too often the "Entertainment Tongiht" of the print media. it's articles seem to be designed to be just long enough to read while taking the average length dump.


    You must shit really quickly.

    icon_biggrin.gificon_lol.gif


    LOL. (I mean, sorry, I thought it was funny!)